2017 FUTA Increase Alert

Effective January 1st, 2017, the FUTA rate for all CA employers will increase to 2.7%

Effective January 1st, 2017, all California employers are mandated to increase the amount of payroll taxes that are withheld. Currently, the withholding rate for 2016 is 2.4% of payroll per employee up to $7,000 in gross wages. In 2017, this rate will increase to 2.7% of payroll per employee, with the cutoff remaining at $7,000.

Though the FUTA rate has steadily increased by 0.3%e each year since the initial increase in 2011, The FUTA Rate is projected, by some, to return back to the original rate of 0.6% as early as 2018.